Air Canada Strike: Pilots Return To Bargaining Table To Try To Reach Agreement

TORONTO - Air Canada (TSX:AC.A) and its pilots will give negotiations one last try in an effort to avoid having to accept a settlement that would be imposed under recently passed federal legislation.

The two sides announced Thursday night that they've agreed to return to the bargaining table for 10 days to try to reach a tentative deal under the guidance of a federal arbitrator.

The airline was poised to lock out the pilots earlier this year, but the move was short-circuited by the federal government, which passed legislation blocking either side from initiating job action and imposing a new contract.

The move was angrily received by many of its 3,000 pilots, and was followed by some pilots calling in sick on more than one occasion, disrupting the airline’s schedule and angering passengers.<

Air Canada went to the Canada Industrial Relations Board, which said the so-called "sick-in," which wasn't officially backed by the union, amounted to an illegal strike.<

It was unclear whether the angry response from the pilots played a role in propelling the two sides back to the bargaining table. Both sides announced a media blackout was being imposed on the talks and refused to elaborate beyond their brief news releases.

It's likely the unrest among the pilots in the wake of the federal legislation is a force propelling the two sides back the table, says a labour expert at Queen's University.

"I think that the sick outs may have had an influence, but more because the pilot's union is losing control and the (Air Canada) brand is being harmed by passenger disruptions," George Smith, who was a former Air Canada employee relations director, said in an email.

"I think (Air Canada probably orchestrated this in an attempt to 'take back' the collective bargaining process," he said.

A news release from Air Canada simply said the federal legislation contained a clause that allows the two sides to ask an arbitrator to "facilitate" negotiations.

The Air Canada Pilots Association said in a release that Federal Labour Minister Lisa Raitt was to appoint an arbitrator soon. Once that was done, the negotiations could start. Raitt's office did not immediately respond to requests for comment.

The pilot's union said if the talks failed to produce a tentative agreement, the federal arbitration process imposing a settlement would proceed.

Air Canada has been beset by labour problems for most of the last year with all of its major unions.

The federal government also intervened this year to prevent a strike by Air Canada ground crews. Some ground staff in Toronto staged a wildcat strike to show their anger with the move disrupting the airline's operations.

Last year Air Canada ticket agents and customer service staff staged a brief strike before reaching a deal after Raitt threatened to legislate them back to work. Raitt also pulled levers behind the scenes when flight attendants rejected a tentative agreement and held a strike vote.

The rollercoaster of labour unrest at Canada's airline has prompted many of its customers to look at alternatives to getting to their destinations.

It's a message that appears to have not been lost on Air Canada senior management. In a letter to airline staff last month, CEO Calin Rovinescu wrote: ``Our immediate focus now has to be to work doubly hard to regain that confidence - and we have our work cut out for us as we've disappointed them all too frequently lately.''

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About 3,800 customer sales and service representatives represented by the Canadian Auto Workers union held a three-day strike in June. They reached a deal with company just hours after the federal government introduced a bill seeking to legislate them back to work.
At issue was employee pensions. The airline proposed new hires would receive defined contribution pension plans instead of the defined benefit plans current employees have.
Ground workers ratified a new contract that leaves pensions alone, but negotiations continue over their future shape.
-- The Canadian Press

Air Canada's 6,800 flight attendants voted 98 per cent in favour of a strike action in September, rejecting a contract the Canadian Union of Public Employees had negotiated with the airline.
At issue, once again, was pensions -- Air Canada had proposed that new hires would receive defined contribution pensions plans instead of the defined benefits plans flight attendants currently receive.
CUPE and the airline negotiated a second deal in October, and flight attendants rejected it again -- this time by a more narrow 65 per cent.
The federal government intervened again, sending the dispute to an arbitrator, who imposed the second agreement hammered out between the union and the airline.
-- Canadian Press files

Air Canada's pilots and ground technicians were set to walk off the job just in time for March break when Air Canada threatened to do it for them and lock them out.
For the third time in less than a year, the federal government intervened, passing back-to-work legislation and sending the matter to the industrial relations board.
Prime Minister Stephen Harper defended the government's repeated use of back-to-work laws to prevent Air Canada strikes and lockouts, saying the airline is crucial to Canada's economy and cannot be allowed to stop operating, especially during a high travel season.
-- Canadian Press files

Days after a pilots' and machinists' strike was averted, Aveos, an Air Canada maintenance contractor, announced it was shutting plants in Montreal, Vancouver and Winnipeg laying off 2,400 employees. Some 200 employees in Montreal blocked access to the Air Canada building at Montreal's Pierre Elliott Trudeau building on Monday March 19, 2011.
-- Canadian Press files

Days after Labour Minister Lisa Raitt used legislation to prevent a walkoff or lockout of Air Canada pilots, the airline was hit with a flurry of delays and cancellations as an unusually high number of pilots called in sick to Montreal's Trudeau airport.
The airline clearly suspects the move may have been some kind of covert labour action, as it has filed a complaint about the incident with the labour relations board.
-- Canadian Press files

A ground crew wildcat strike disrupted Air Canada's operations at Pearson Airport on Friday, March 23, 2012, after the airline reportedly fired three workers who had followed Labour Minister Lisa Raitt through the airport, heckling her. When ground workers walked off the job in protest, the airline reportedly fired 37 of them, causing further job walkoffs. The labour relations board eventually put a stop to the protests and reinstated the 37 fired workers, but not before the strikes had spread, briefly, to airports in Montreal and Vancouver.

A month after pilots in Toronto and Montreal called in sick en masse, prompting flight cancellations, the same thing appeared to happen again, as a "sick-out" by pilots hit Toronto's Pearson Airport. At least 60 flights were cancelled the morning the apparent job action hit.
The Air Canada Pilots Association distanced itself from the action, saying it wasn't sanctioned by them. Air Canada described the sick-out as "illegal."
Photo: Chris Bouchard, whose flight to Calgary was cancelled upon his arrival, checks flight times at Toronto Pearson Airport on Friday, April 13, 2012. (THE CANADIAN PRESS/Michelle Siu)

Air Canada pilots lost their monumental labour battle with the airline when an arbitrator, appointed by the government after back-to-work legislation, sided with the airline. The decision sent Air Canada stock higher on the expectation the decision would pave the way for a discount Air Canada airline brand, but left the company's pilots angry and disillusioned.